Why did GAAP profit decline while operating profit grew?

GAAP profit fell 2% to $2.2B because of a $309M pre-tax loss on retained and sold ownership interests and other equity securities, along with other non-operating items. Non-GAAP operating profit excludes these items and rose 18% to $2.5B, driven by services volume and pricing.

Is GE Aerospace on track to meet its 2026 guidance?

Management maintained all 2026 guidance and said results are trending toward the high end of the range given the strong start. However, guidance assumes elevated oil prices through Q3, near-term fuel availability constraints, lower global GDP estimates, and flat to low-single-digit departure growth, so outcomes depend on these macro factors.

Why did operating margins contract despite strong revenue growth?

Operating margin fell 200 bps to 21.8%, and CES margin fell 230 bps to 26.4%. Management attributed this to growth in installed engines (including GE9X), investments, and mix, partly offset by price and lower charges on long-term service agreements.

What drives the strength in the order book?

CES orders rose 93% to $17.3B, with services up 49% and equipment more than tripling. Management pointed to a $170B commercial services backlog, plus large airline agreements, including more than 300 LEAP-1A engines for American Airlines and a Ryanair fleet materials agreement covering roughly 2,000 CFM56 and LEAP engines.

How is free cash flow tracking against the full-year target?

Q1 FCF was $1.66B, up 14%, and CFOA was $1.87B, up 21%. The full-year FCF guide of $8.0B-$8.4B implies that cash generation will need to build through the rest of the year, with FCF conversion guided above 100% of adjusted net income.

GE 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed April 21, 2026. Cited figures are marked; the original filing is the authoritative source.

GE Aerospace (General Electric Company) reported first-quarter 2026 results on April 21, 2026, and the headline is strong commercial demand.

Total orders rose 87% to $23.0B^a, and adjusted revenue grew 29% to $11.6B (GAAP revenue $12.4B, up 25%). Adjusted EPS rose 25% to $1.86 and free cash flow rose 14% to $1.66B. Commercial Engines & Services (CES) drove the quarter, with revenue up 34% to $8.9B, services up 39%, and orders of $17.3B, up 93%.

Defense & Propulsion Technologies (DPT) revenue grew 19% to $3.2B^b, with orders up 67%. Profitability was more mixed. GAAP profit fell 2% to $2.2B and GAAP margin contracted 490 bps to 17.7%, largely because of a $309M pre-tax loss on retained and sold ownership interests and other equity securities.

Operating profit (non-GAAP) rose 18% to $2.5B^c, but operating margin fell 200 bps to 21.8%, reflecting install-base growth (including GE9X), investments, and mix. CES margin fell 230 bps to 26.4%, and DPT margin slipped 20 bps to 11.8%. Management held full-year 2026 guidance across the board (adjusted revenue growth low-double-digits, operating profit $9.85B-$10.25B, adjusted EPS $7.10-$7.40, FCF $8.0B-$8.4B) and said it is now trending toward the high end of the range.

Guidance assumes elevated Brent crude through Q3, a near-term fuel-availability impact, lower global GDP estimates, and flat to low-single-digit departures growth, but does not assume a global recession. Management cited a $170B^d commercial services backlog as support for the outlook.

02—Key points

Key Highlights

Orders of $23.0B, up 87%, with CES orders of $17.3B (+93%) and DPT orders of $6.2B (+67%).
Adjusted revenue of $11.6B (+29%) and CES revenue up 34%, with services revenue up 39% and total engine deliveries up 43% year over year.
Adjusted EPS of $1.86 (+25%) and operating profit of $2.5B (+18%), while GAAP EPS was flat at $1.83.
GAAP profit margin fell 490 bps to 17.7%, driven by a $309M pre-tax loss on equity securities and ownership interests; operating margin fell 200 bps to 21.8%.
Free cash flow of $1.66B (+14%) and CFOA of $1.87B (+21%).
Full-year 2026 guidance maintained, with the company trending toward the high end of the range; adjusted EPS guide is $7.10-$7.40 and FCF guide is $8.0B-$8.4B.
Commercial wins include more than 650 engines (American Airlines, United, Delta, and a Ryanair fleet-wide materials agreement) and a $1B U.S. manufacturing investment plan.

03—Questions

Frequently Asked Questions

Why did GAAP profit decline while operating profit grew?
GAAP profit fell 2% to $2.2B because of a $309M pre-tax loss on retained and sold ownership interests and other equity securities, along with other non-operating items. Non-GAAP operating profit excludes these items and rose 18% to $2.5B, driven by services volume and pricing.
Is GE Aerospace on track to meet its 2026 guidance?
Management maintained all 2026 guidance and said results are trending toward the high end of the range given the strong start. However, guidance assumes elevated oil prices through Q3, near-term fuel availability constraints, lower global GDP estimates, and flat to low-single-digit departure growth, so outcomes depend on these macro factors.
Why did operating margins contract despite strong revenue growth?
Operating margin fell 200 bps to 21.8%, and CES margin fell 230 bps to 26.4%. Management attributed this to growth in installed engines (including GE9X), investments, and mix, partly offset by price and lower charges on long-term service agreements.
What drives the strength in the order book?
CES orders rose 93% to $17.3B, with services up 49% and equipment more than tripling. Management pointed to a $170B commercial services backlog, plus large airline agreements, including more than 300 LEAP-1A engines for American Airlines and a Ryanair fleet materials agreement covering roughly 2,000 CFM56 and LEAP engines.
How is free cash flow tracking against the full-year target?
Q1 FCF was $1.66B, up 14%, and CFOA was $1.87B, up 21%. The full-year FCF guide of $8.0B-$8.4B implies that cash generation will need to build through the rest of the year, with FCF conversion guided above 100% of adjusted net income.

04—Continue

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